Portability, hypertension and a ₹6.8 lakh bypass claim
Suresh Nair, 54, held a ₹15 lakh family floater with Insurer A continuously from April 2016 to June 2023. He disclosed hypertension at proposal in 2016 and had been on two tablets since 2018; Insurer A paid a small claim for a hypertensive episode in 2021.
In June 2023, when his employer's group cover was withdrawn, he ported the policy to Insurer B on the same sum insured. Insurer B accepted the portability application at standard rates and issued the policy on 12 June 2023, with a two-year pre-existing disease waiting period in the wording.
In March 2024 Suresh was hospitalised for a triple-vessel coronary artery bypass graft costing ₹6.8 lakh. Insurer B's third-party administrator rejected the claim, saying the new policy's pre-existing disease waiting period had not been completed and that his hypertension history had not been 'freshly disclosed' at portability.
Suresh says he has been covered without a break since 2016 and that his agent told him portability 'carries forward everything'.
1. Was the third-party administrator's rejection correct?
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The rejection is not sustainable on these facts.
- Portability under the IRDAI health insurance framework exists precisely so that a policyholder does not lose waiting-period credit by changing insurers. The new insurer must count the period of continuous coverage with the previous insurer when applying waiting periods, including the pre-existing disease waiting period.
- Suresh's hypertension was disclosed in 2016 and was covered by Insurer A. By June 2023 he had seven years of continuous cover, well past any two-year pre-existing disease waiting period. That credit travelled with him to Insurer B.
- Insurer B accepted the portability at standard rates with no loading or exclusion. Having accepted the risk on the previous insurer's records, it cannot re-open the same disclosed condition at claim time. The 'not freshly disclosed' argument confuses portability with a fresh proposal: in portability the source of truth is the previous insurer's records and the portability form, not a new declaration.
- The claim is for a new manifestation of a long-covered, disclosed condition, not a concealed one.
- What the administrator should check instead: whether the CABG is within the ₹15 lakh sum insured, room-rent and consumable limits, and whether the 30-day initial waiting period was served (it was).
Suresh should escalate to Insurer B's grievance officer, then the Insurance Ombudsman; ₹6.8 lakh is within the Ombudsman's monetary jurisdiction. He must keep every Insurer A renewal receipt, the 2021 claim file and the portability form.
2. What would the position be if Suresh had let the Insurer A policy lapse in June 2023 and bought a fresh policy from Insurer B in September 2023?
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Then the rejection would be correct, and the difference is entirely documentary.
- With a lapse and a fresh proposal there is no portability and no continuity credit. The two-year pre-existing disease waiting period restarts on 12 September 2023 and is not complete in March 2024.
- The claim would fall squarely inside the waiting period, and the insurer could reject it even though nothing was concealed - the exclusion operates by contract, not by fault.
- The narrow escape routes: a 30-day grace period for renewal keeps the policy alive if the premium is paid within it; a genuine accident or acute condition is outside the pre-existing disease exclusion; and the insurer must still pay for any unrelated illness.
- This is why an agent handling a job change or a group-to-individual transition must apply for portability before the renewal date - most insurers want the application 30-45 days ahead - and must never let the old policy lapse while the new one is being processed.
One lapse can cost a client the entire waiting-period history and, in a case like this, ₹6.8 lakh.
3. What should the agent have told Suresh in June 2023, and what records should exist?
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Four things, all of which would have prevented the dispute:
- Apply early. Portability applications generally need to reach the new insurer 30-45 days before the existing policy's renewal date. A late application is a common reason portability fails.
- Keep the old policy alive until the new one is issued. Do not let the renewal lapse on the assumption that portability is automatic.
- Document the disclosure chain. Obtain Insurer A's renewal endorsements, the claim history and the list of disclosed conditions, and attach them to the portability form. A clear line - 'hypertension since 2018, on two tablets, claim paid 2021' - is what defeats the 'not disclosed' argument later.
- Explain what does and does not carry forward. Waiting-period credit carries; no-claim benefits, cumulative bonuses and restore benefits generally do not, and the new policy's sub-limits and room-rent caps apply instead.
Keep the file: the portability form, the old policy's renewal receipts and a written note of the advice given. In a claim dispute, the agent's contemporaneous note is often the only evidence of what the client was told.